Assessing the economic implications of Kyat-Yuan transactions in Myanmar-China trade

In recent years, global economic dynamics have shifted away from the traditional dominance of the US dollar in international trade. This trend is reflected in China and Myanmar’s bilateral transactions, traditionally conducted in US dollars. However, geopolitical and economic considerations have prompted these nations to explore alternatives, with China actively promoting the internationalization of the Yuan. The decision to adopt the Yuan for bilateral transactions is driven by the desire to reduce dependency on the US dollar, insulating both nations from its fluctuations and fostering a more stable trade environment. The research focuses on the economic implications of Kyat-Yuan transactions in the context of Myanmar-China trade. Utilizing statistical analyses and scenario difference-indifference analysis, the study reveals a positive impact on various economic indicators. The findings suggest that a stable Kyat-Yuan transaction system can serve as a catalyst for enhancing bilateral trade relations. Policymakers are urged to ensure the sustainability of these gains, considering additional adjustments or improvements. In conclusion, the report emphasizes the crucial role of the trade sector in sustaining economic stability and fostering international partnerships amid challenging circumstances.